Six questions a CEO should answer before purchasing a reservation system

Simple to search, book and pay, always accessible and higher occupancy: a reservation platform ensures higher turnover and lower administrative costs. As long as the system is a good fit with business processes and future vision, of course. Is the system scalable, allowing sufficient room for potential growth in the number of customers? Is it possible to add modules and features if a business introduces a new service, for example? And does the system offer sufficient protection against cyber attacks? All sorts of strategic choices are involved in the selection of a reservation system. It is, therefore, the task of the CEO (or CIO) to make these decisions. Here are six questions that every CEO should ask themselves before making a selection.

1. Standard or custom-built: what is the available budget?

There are countless standard, off-the-shelf or SaaS products on the reservation system market. In general, these products are less expensive to purchase but a disadvantage is their limited flexibility. Only the front end is customisable and ‘tweakable’. This obliges you, as a company, to follow the underlying business logic of the solution instead of the other way around: you adapt the existing business process to the system. All kinds of plug-ins are needed to upgrade the system. A custom-built system is created from the ground up and specially tailored to your company’s business model and specific wishes. In short: you get exactly what you want.

2. Should a proposition be marketable quickly?

Does a company have a proposition or service that it wants to deploy quickly in other countries and/or for other brands or companies in response to demand? In that case, a white label system is a good solution. This is a custom-built system that is easy to ‘copy’. The company saves time (and costs) because it doesn’t have to keep repeating the design and programming process. You benefit from the developer’s years of experience, trial and error, and all previously implemented optimisations. A white label system is a good solution for a company that wishes to offer both a high-end and budget version of a service or product. A good example of this is the difference between Quickparking and Budgetparking: two businesses/reservation systems from the same parent company.

3. How scalable should the reservation system be?

Standard reservation systems, in general, offer little flexibility or scalability. With a custom-built solution, on the other hand, a company runs a lower risk of encountering limitations during a later growth phase. You can add new features whenever you like, for example. This offers a significant competitive advantage over companies that use standard solutions. The ability to respond to market developments quickly is absolutely essential.

4. A monolithic custom-built reservation system or one based on micro-services?

In terms of scalability, the difference between a traditional, monolithic system and a solution based on micro-services architecture is also important. The difference is in the method of development. In the first example, the entire reservation system is developed centrally, making it somewhat cumbersome. The second type of system is divided into small, mutually co-operating micro-services, which are all developed separately. The system then becomes the sum of its various parts. This offers significant advantages in terms of maintenance, flexibility, and scalability. As a company, you can add extra examples of each component, as required, such as extra containers with shopping carts during busy periods in a webshop. So, if you expect a lot more turnover in the near future or want to offer supplementary or additional services quickly, it would be better to choose a system with a micro-services architecture.

5. Open source or closed source?

Open source software is free to use and can be adapted as you please. A disadvantage is that the software is not always reliable. Because the open software codes are available online, malicious parties can also use a code in the wrong way. Over the years, many plug-ins with viruses have been developed for open source software. With closed source software, you build a reservation system from the ground up. This makes the system easier to protect and more resistant to hacking.

6. Digital marketing: adapt CMS yourself in a flexible way or make it compulsory?

A company does not want to be dependent on its supplier or developer to implement every tiny adjustment. The costs can easily build up and it limits the response speed. With a standard solution, this is often the situation but with a custom-built solution, you often have the flexibility to carry out CMS adjustments to the reservation system yourself. You are able to run A/B tests yourself, optimise funnels and more. Ultimately, this leads to better commercial results.

Which type of reservation system suits your company?

Your answers to the above questions should provide a good indication. As a rule, only small businesses and start-ups with a limited budget choose SaaS. Medium-sized and large companies mostly go for a custom-built solution based on their own wish list. Certainly, if a company is looking for scalability, flexibility and/or a white label solution, it cannot avoid hiring true professionals. The costs involved are a much-used argument for not choosing a custom-built solution. But this is an outdated argument. Your dream custom-built solution does not need to cost the earth if you choose for nearshoring. You then benefit as a company from expert developers and a transparent working method and communications, while paying only a third of the usual costs in the Netherlands. Interested? Get in touch with Typeqast. We would be happy to assist you.

Meynald is an entrepreneur and founder of Typeqast.

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